Protecting Your Future: Why Couples Should Consider Signing a Prenuptial Agreement

Getting a prenuptial agreement before tying the knot? There are many reasons couples avoid signing one. Sometimes, couples think that if they create a prenup, they are planning to divorce before they have even reached the altar. Other times, they believe prenups are just for the “rich and famous.” However, both of these fears are far from the truth.

Similar to how many people create a will to plan for the future without dwelling on the end of their lives, a prenuptial agreement safeguards both spouses in the event of a contentious separation. By outlining terms in advance, a prenup establishes how each spouse’s responsibilities and rights will be managed should a divorce happen.

Read on to learn why signing a prenuptial agreement before you marry ensures a smooth path ahead as you start your lives together.

Prenups by the Numbers

More than 50% of divorce attorneys report increased demand for prenuptial agreements. Surveys also show that 50% of U.S. adults said they at least somewhat supported the use of prenups, although only one in five married couples has an agreement in place. That is up from the prior year, though, when 42% of polled adults said they supported using prenups.
Part of the uptick in prenups could be that more people are getting married later in life and want to protect the assets they bring into the marriage. However, interestingly, more younger people are saying “yes” to prenups, with 47% of millennials and 41% of Gen Zers signing prenups while they are engaged.

What’s the Point of Getting a Prenup?

Even with an increase in prenups for U.S. couples, 63% of people worry that their marriage has a higher chance of ending if their spouse asks them to sign a prenup. To put your mind at ease, here are some of the ways that putting a prenup in place before your marriage can protect you and your assets:

Safeguard your personal property and assets.
Protect the inheritance rights of children and other family members from previous relationships or marriages.
Shield your business from potential claims by your ex-spouse.
Safeguard your financial interests, especially if you have substantial wealth or property when you enter the marriage.
Retain control over your personal property and finances.
Determine rights to retirement accounts or waive them.
Prevent disputes over property division during divorce proceedings.
Make property division decisions while you and your spouse are on good terms.
Avoid liability for your spouse’s debts after divorce.
Set specific terms for spousal support or waive it altogether if the marriage should end.
Establish how you’d manage or share living expenses if you split.
Reduce or avoid the high costs associated with divorce litigation.

What Are the 7 Benefits of Getting a Prenup?

If you and your partner are considering a prenuptial agreement, it is normal to be hesitant. Check out these seven important reasons why getting a prenup could help, not hurt, your upcoming marriage.

1. Before tying the knot, you and your future spouse get honest about money.
Do you know that experts estimate that money issues contribute to 20% to 40% of all divorces? In other words, four out of every 10 marriages that end in divorce are due to financial conflicts.

Having honest conversations about money is not always easy. However, when you create a prenup, you’re in the position to proactively discuss your finances and financial goals so you can get on the same page as your partner.

Will you keep separate bank accounts, start a joint account, or do both? Will you work together to pay off each other’s debts? How much do you want to put into retirement accounts from your paychecks? What’s your plan and timeline for purchasing a home? Do you want to buy additional properties? How much money do you want to allocate to a monthly household budget and for dinners out or vacations?

Before getting married, it’s essential to openly discuss how you will handle finances to achieve your shared goals and ensure that you and your future spouse align.

2. A prenup defines and protects your property.
There are a few ways that breaking down ownership of assets in a prenup can give you peace of mind:

Define which assets and finances belong solely to each spouse. Also called “separate property,” these assets can include money in your bank account, property you purchased before the marriage, or investments. Communal or joint marital property means owning it 50/50 with your spouse.
Define and protect future assets. These could include income from a business you plan to start, intellectual property, or assets from a family trust or inheritance.
Define asset division in the event of a divorce. While you don’t plan to divorce, deciding how assets would be divided may be a better option while you’re currently in a good place with your spouse. Knowing you’ve decided how assets would be divided can give you peace of mind.

3. A prenup protects both spouses’ financial stability.
It’s common for one spouse to earn significantly more than the other in a marriage, with one partner potentially staying home to care for children without earning an outside income. In such cases, a prenup can include clauses that define how the higher-earning spouse would support the other in case of divorce. These clauses can also outline a weekly allowance for the stay-at-home spouse, recognizing their sacrifice of time away from their professional career.

4. A prenup can protect you from your spouse’s debts.
While you are on good terms with your spouse-to-be, it’s a good idea to discuss how you would divide debts in the case of a divorce. Otherwise, if your marriage ends, you could find yourself saddled with a significant portion of your spouse’s debt that you were not part of incurring. A prenup can include a provision that addresses debts and liabilities should your marriage end to protect you from taking on an unfair amount of your marriage debt.

5. Keep heirlooms and assets in your family with a prenup.
No, you are not planning to divorce, but if you have family assets you wish to keep in your family, this can be an essential part of your prenup. For example:

You have a family business or investment property you wish to remain in your family in the case of a divorce. This provision comes into play if you have children from a previous relationship and want to leave assets to specific beneficiaries.
You have inheritances or estate plans. Designating who’ll receive certain assets upfront is crucial so they don’t become contested during divorce proceedings.

6. Prenups can help you define other aspects of your marriage.
While prenups generally focus on financial matters and assets, you can include provisions and agreements in other areas. For example:

How you would handle personal items, sentimental belongings, or pets in the event of a split.
How you will handle sharing details or photos of your relationship on social media during a divorce.

7. Creating a prenup now can save you from a costly, contentious divorce.
Drafting a prenup before you marry is much less expensive than spending tons of money and time hashing out a contentious divorce in court. Again, while your intention when you marry is not to divorce, laying out how you’d like to handle things in the event of a split makes sense – helping you save time and costly legal fees and keep stressors down.

For example, you ensure an amicable divorce vs. one that will drain your emotions and bank account by deciding certain things ahead of time:

You can spell out who gets the house or how spousal support will work in a split.
You can decide beforehand to work through issues via mediation or arbitration rather than going to court. Since a prenup can’t include provisions concerning child support or parenting time, agreeing to mediation during a divorce can help keep things peaceful for your family.

Are Prenups Set in Stone?

A prenuptial agreement needs to be written and signed by both you and your future spouse willingly. Both parties must also fully disclose their financial situations when signing. Each party should have the chance to consult with a lawyer unless they choose to waive this right in writing.

In New Jersey, if you are planning to sign a prenuptial agreement, it is essential to remember that the court might consider it invalid under certain circumstances.  These circumstances include:

The prenup must be in writing.
Both parties must sign the agreement.
Neither party should be under pressure to sign the agreement.
Both parties are required to disclose their entire financial situation.
Both parties should have the opportunity to speak with a lawyer before signing the agreement. They can waive this right in writing if they choose to do so.
The agreement should not be highly unfair or unjust when signing.

Don’t Wait to Create and Sign Your Prenup

You will need to negotiate and sign your prenup before your wedding date. That gives you and your spouse-to-be enough time to discuss and define your agreement with each other, your attorney, and any other necessary experts. To be enforceable, both parties must sign your prenup before the wedding, so time is of the essence.

Contact the Experienced Family Law Attorneys at Lawrence Law for Guidance About Creating a Prenuptial Agreement

Do not risk drafting your pre-marriage agreement without a competent prenuptial agreement lawyer in your corner. The legal team at Lawrence Law is here to guide you through each step of the process and get you the peace of mind you deserve.

Lawrence Law proudly handles prenups and family law cases for our clients throughout New Jersey.

Call (908) 645-1000 to schedule a consultation or fill out our confidential contact form. Our offices are conveniently located in Watchung and Red Bank, NJ. If you need assistance with drafting a prenuptial agreement, don’t hesitate to contact us today.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you’re seeking legal advice, please contact our law firm directly.